Do you know what your credit score is? Are you afraid of what you might find? If you don’t know what your credit score is, you’re not alone. Although your credit score isn’t a number that is readily in your face like your checking account balance, it is a number you should always know.
Here are 4 reasons (plus 2 bonus ones!) why you should always know your credit score:
Prevent Identity Theft
Identity theft is a real thing and can be detrimental not only to your credit score, but also to your bank and credit card accounts. New accounts that have been opened in your name are the first sign of identity theft and can be detrimental to your score. By regularly checking your credit score, you can be on top of false accounts and purchases that have been made in your name. With a constant baseline understanding of your score, you will be able to detect abnormalities in your score and act much quicker.
Credit agencies and creditors make mistakes and sometimes those mistakes can negatively affect your credit score. Can you imagine having your mortgage balance misreported as $500,000 instead of $50,000? Or perhaps you share the same name as your father and constantly have creditors mixing your accounts? (That kind of error happens a lot!) Having a constant eye on your credit report will allow you to see how your debts are affecting your score and correct any mistakes made in relation to those accounts.
Credit isn’t always a terrible thing, particularly in situations where you have an investment opportunity. For example, if you are a real estate investor, you might see an investment opportunity that requires quick action. If you don’t know your credit score, you won’t know if a lender will quickly approve you for a loan to purchase the property. By having a strong handle on your credit score, you can quickly determine if an opportunity is right for you and not waste time pulling your credit report.
Emergencies happen. You’ve been unexpectedly fired. The bathroom floods the house. Or someone has a medical emergency in your family and the expenses are through the roof. In those situations, you might need to get a loan to help cover the costs. Not knowing your credit score can add an unpleasant surprise in a time where you are already worried about costs. By knowing your score, you can walk into a bank knowing what you can ask for and not be surprised by the response.
Bonus Reason #1: It’s Free!
Here’s a bonus reason for why you should always know your credit score. It’s free! Many credit card companies print a free credit score on your statement now each month. If you do not have one of these kinds of credit cards, you can order a score report from one of the credit reporting companies. We usually recommend Experian as we find their reports to often be the most up to date.
Each of the three credit bureau agencies allows you to pull your report for free per year. These reports do not include a score, but if you time it correctly, you can get your credit report once every four months and have a strong sense of how your report is doing on a regular basis. We recommend you get your free reports from annualcreditreport.com. It’s the only service recognized by the US Government.
Bonus Reason #2: Knowing is Half the Battle
Your credit score is based off the information in your credit report at any given time. Changing your credit score can’t be done overnight. It often requires changing your spending and payment habits over a consistent amount of time. By regularly checking your credit report, you can use the information about your score and determine what you need to do to improve your score so that you can be ready for those emergencies, opportunities, and anything else that life throws at you.
If you have negative items on your credit report, think you have errors or inaccuracies, or want more help understanding how the NCES Credit Restoration program can help you restore your credit, please request a FREE consultation today.
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This information is intended for informational and educational purposes only and not as legal advice. If you have concerns about your credit report, harassment, identity theft, illegal collections activity, garnishments, or property liens, you should consult an attorney who specializes in consumer rights and defense.